It has not been assumed that all the impacts of climate change will be detrimental.
Indeed, several studies have looked at possible benefits. Moreover, adaptation
is a means of maximizing such gains as well as minimizing potential losses.

However, it must be said that potential gains have not been well documented,
in part because of lack of stakeholder concern in such cases and consequent
lack of special funding. Examples that have not been fully documented include
the possible spread of tropical and subtropical horticulture further poleward
(but see some New Zealand studies, on kiwi fruit, for exampleSalinger
and Kenny, 1995; Hall and McPherson, 1997b). In southern parts of Australia
and New Zealand, notably Tasmania, there could be gains for the wine industry,
increased comfort indices and thus tourism, and in some scenarios increased
water for hydroelectric power generation.

Guest et al. (1999) have documented possible decreases in winter human
mortality alongside possible increased summer mortality (see Section
12.7.1), and Howden et al. (1999d) have shown that Australian wheat
yields may increase for 1 or 2°C warming, before showing declines at greater
warmings (see Section 12.5.3 and Figure
12-3). A similar situation may apply to forestry (see Section
12.5.4). Such studies take account of gains from increased CO2
concentrations. Changes in overseas production and thus in markets in some cases
also could lead to greater demand and higher prices for Australian and New Zealand
primary products (see Section 12.5.9), but only if
such changes do not disrupt world trade in other ways (e.g., lower capacity
to pay).

Vulnerability and adaptation to climate change must be considered in the context
of the entire ecological and socioeconomic environment in which they will take
place. Indeed, adaptations will be viable only if they have net social and economic
benefits and are taken up by stakeholders. Adaptations should take account of
any negative side effects, which would not only detract from their purpose but
might lead to opposition to their implementation (PMSEIC, 1999).

Adaptation is the primary means for maximizing gains and minimizing losses.
This is why it is important to include adaptation in impact and vulnerability
studies, as well as in policy options. As discussed in Chapter
18, adaptation is necessary to help cope with inevitable climate change,
but it has limits; therefore, it would be unwise to rely solely on adaptation
to solve the climate change problem.

In some cases adaptation may have co-benefits. For example, reforestation to
lower water tables and dryland salinization or to reduce storm runoff may provide
additional income and help with mitigation (reduction of GHG emissions). However,
other potential adaptations may be unattractive for other reasons (e.g., increased
setbacks of development in coastal and riverine environments). These considerations
have particular application in Australia and New Zealand. Studies of adaptation
to climate change in Australia and New Zealand are still relatively few and
far between. They are summarized in the remainder of this section.

12.8.2. Integrated Assessments and Thresholds

Over the past decade there have been several national and regional assessments
of the possible impacts of climate change. A regional assessment for the Macquarie
River basin was done by Hassall and Associates et al. (1998, reported
in Basher et al., 1998); Howden et al. (1999d) made a national
assessment for terrestrial ecosystems (see Section 12.5).
Two other preliminary regional assessments cover the Hunter Valley in NSW (Hennessy
and Jones, 1999) and the Australian Capital Territory (Baker et al.,
2000). The former was based on a stakeholder assessment of climate change impacts
that identified heat stress in dairy cattle as a subject for a demonstration
risk assessment. Thresholds for heat stress and the probability of their being
exceeded were evaluated, as were the economic value of adaptation through installation
of shade and sprinklers (see Section 12.5.2; Jones
and Hennessy, 2000). Baker et al. (2000) made a preliminary qualitative
assessment of the impacts of scenarios on the basis of the CSIRO RCM at 60-km
resolution (Hennessy et al., 1998) on a wide range of sectors and activities.

However, most integrated studies in Australia and New Zealand have been "one-off"
assessments, have lacked a time dimension, cannot readily be repeated to take
account of advances in climate change science, and often have not placed the
problem in its socioeconomic context. Several groups are collaborating on integrated
modeling systems that overcome these drawbacks. In New Zealand this is called
CLIMPACTS (Kenny et al., 1995; Warrick et al., 1996; Kenny et
al., 1999, 2000), and an Australian system called OZCLIM has been based
on it. These integrated models contain a climate change scenario generator,
climate and land surface data, and sectoral impact models. They provide a capacity
for time-dependent analyses, a flexible scenario approach, a capability for
rapid updating of scenarios; and inclusion of models for different sectors.
One application is reported in Section 12.5.2.

OZCLIM contains regional climate patterns for monthly temperature and rainfall
over Australia from several GCMs and the CSIRO RCM. They can be forced or scaled
by the latest emission scenarios, and variables include potential evapotranspiration
and relative humidity. It is being adapted to produce projected ranges of impact
variables and to assess the risk of exceeding critical thresholds (CSIRO, 1996b;
Jones, 2000; Pittock and Jones, 2000).

There are different levels and styles of integration in impact and adaptation
assessment, and several of these have been attempted in Australia and New Zealand.
Bottom-up integration was done for a range of climate change scenarios in the
water supply, pasture, crop, and environmental flow sectors for the Macquarie
River basin study by Hassall and Associates et al. (1998). It also has been
done in a more probabilistic way to take account of uncertainty, with a focus
on the probability of exceeding a user-defined threshold for performance and
the need for adaptation (Jones, 2000).

Top-down integration has been attempted via the use of global impacts assessment
models with some regional disaggregationsuch as a regional analysis based
on the Carnegie Mellon University ICAM model, which was used to examine adaptation
strategies for the Australian agricultural sector (Graetz et al., 1997). The
principal conclusions were that climate matters and that the best strategy is
to adapt better to climate variability.

Another top-down approach, based on an Australian regionalization of the DICE
model of Nordhaus (1994), is that of Islam (1995). An initial application of
this model to quantifying the economic impact of climate change damages on the
Australian economy gave only a small estimate, but the authors expressed reservations
about model assumptions and the need to better quantify climate impacts (Islam
et al., 1997). Others have examined the structure and behavior of the Integrated
Model to Assess the Greenhouse Effect (IMAGE) but to date have not applied this
to climate change impacts in Australia (Zapert et al., 1998; Campolongo and
Braddock, 1999).

A spatially explicit modeling system known as INSIGHT is being developed to
evaluate a wide range of economic, social, environmental, and land-use impacts
that could affect large areas (Walker et al., 1996). It can map and summarize
key social, economic, and environmental outcomes in annual steps to the year
2020. The need for such a system was identified through workshops involving
potential stakeholders, and the system could factor in scenarios resulting from
climate change.

As pointed out in PMSEIC (1999), much of Australia is subject to multiple environmental
problems, of which climate change is only one. This leads to a logical emphasis
on regional integrated assessments, which look for adaptations and policies
that help to ameliorate more than one problem and have economic benefits.